BMW to supply diesel engines for Toyota: report

BMW and Toyota could be about to share fuel-efficient technologies, at least initially with Toyota adopting BMW diesel engines for an upcoming model in Europe.

According to a Nikkei Business Daily report, the two companies were recently in talks about such a deal, including Toyota borrowing a BMW 2.0-litre diesel engine for upcoming medium-sized models sold in Europe.

The proposal comes after Toyota sales declined in Europe last year by nine per cent. Having local diesel engine technology based in Europe is expected to reduce development costs for Toyota and help the company regain market share in the particular segment.

Toyota is hoping the move will also help it market its diesel vehicles in Europe more effectively, as the strong Yen continues to impact on the price of hybrid models.

Conversely, Toyota is said to be open to lending BMW its hybrid technologies. BMW has already signed a deal with PSA (Peugeot Citroen) in France however, which will see the two companies work on hybrid powertrains of the future.

It’s unknown at this stage what Toyota vehicles will adopt the engines, and when the company plans to launch them.